Wednesday, May 25, 2011

Marvell Technology Group (NASDAQ: MRVL): Q1 Earnings Preview 2012

Marvell Technology Group Ltd. (NASDAQ: MRVL) is scheduled to release its fiscal first-quarter earnings after the closing bell on Thursday, May 26, 2011. Analysts, on average, expect the company to report earnings of 30 cents per share on revenue of $825.89 million. In the year ago period, the company reported earnings of 50 cents per share on revenue of $1.17 billion.

Marvell Technology Group Ltd. designs, develops, and markets analog, mixed-signal, and digital signal processing and embedded microprocessor integrated circuits. The Company develops complex system-on-a-chip (SoC) devices using its technology portfolio of intellectual property in the areas of analog, mixed-signal, digital signal processing and embedded advanced RISC machine (ARM)-based microprocessor integrated circuits. 

In the preceding fiscal fourth-quarter, the Sunnyvale, California-based company's net income was $223 million, or 33 cents per share, compared to $205 million, or 31 cents per share, in the prior year quarter. On an adjusted basis, the company earned 40 cents per share in the fourth quarter. Revenue rose 7% to $901 million from $843 million in the preceding year period. Analysts, on average, expected the company to report earnings of 42 cents per share on revenue of $925.64 million.

At its last earnings call in March, Marvell warned that revenue would drop this quarter. It said revenue in the first quarter would be between $800 million and $850 million, the midpoint representing an worse-than-expected 8 percent dip from the fourth quarter. Executives told analysts that they anticipate a plunge of more than 20 percent in mobile and wireless revenue , while storage sales will slip by a mid-single digit percentage from the previous quarter.

Marvell is a fabless semiconductor company, meaning that they outsource the actual production of their semiconductors to other factories. Marvell’s revenue growth has primary come from sales of its semiconductors designed for data storage.

After a period of weakness during the recession, the Semiconductor- Integrated Circuit sector has enjoyed a strong rebound on the back of increasing consumer demand for smartphone technology. As consumers helped shipments of smartphones grow 71% during 2010, the sector saw booming revenues for companies like Marvell Technology Group Ltd. Tablet PC releases furthered this strength and the Integrated circuits sector should continue on solid ground so long as these devices remain popular

However, Marvell is fending off intensifying competition in smartphone processors from the likes of Nvidia (NASDAQ: NVDA) and Qualcomm (NASDAQ: QCOM), and it supplies chips for BlackBerry-maker Research In Motion. (NASDAQ: RIMM).

Full Disclosure: None.
Related Posts with Thumbnails

Wikinvest Wire